Experian PLC's (LSE:EXPN) annual results may not have been enough to stop the shares falling on Wednesday, but analysts said the update should help reassure investors worried that artificial intelligence could threaten the group’s long-term growth prospects.
The FTSE 100 credit data and analytics company has lost almost a fifth of its market value so far this year amid concerns that generative AI tools could weaken demand for traditional credit checking and data services.
Analysts at Stifel said the latest results underlined the resilience of the business model, pointing to strong margins, robust growth in North America and a fresh $1 billion share buyback programme.
Experian reported revenue growth of 13% to $8.4 billion in the year to 31 March, with organic growth of 8%, while benchmark earnings before interest and tax rose 15% to $2.4 billion. Margins improved 60 basis points at constant exchange rates to 28.6%.
North America remained the standout region, delivering organic growth of 10% and margins above 34%.
The group also increased its dividend by 11% and ended the year with leverage of 1.7 times earnings, giving it room to launch the new buyback while still investing heavily in acquisitions and technology.
Importantly for investors, Experian also highlighted “AI-led productivity gains” as one driver behind expected margin expansion in the 2027 financial year.
Stifel said the shares now trade on around 18.7 times forecast earnings, more than 25% below the company’s 10-year average valuation, despite what it described as a “consistent compounder with a strong track record”.
The broker added that the latest guidance for revenue growth of 8-11% and further margin expansion represented “a good update” from the company.